Ardern rules out land tax on family home

Labour leader Jacinda Ardern told media today while Labour doesn't have a policy on land tax, it won't be ruled out as an option to be considered by the tax working group. PHOTO: GREGOR RICHARDSON

Labour leader Jacinda Ardern has ruled out a land tax on the family home.

Ms Ardern has pledged to set up an expert working group to make recommendations on tax reform, which could include a capital gains tax.

She has made clear any capital gains tax introduced would not apply to the family home, but was asked at a media stand-up in Hamilton today about a land tax.

Such a tax is normally based on a percentage of the land value of a property (not the building), similar to the rates paid to a local council.

Ms Ardern told media today while Labour doesn't have a policy on land tax, it won't be ruled out as an option to be considered by the tax working group.

She indicated she wouldn't want to apply such a tax to the family home.

"There's many complications with the way a land tax works. The simplest way I can convey this is our target is not the family home," Ms Ardern said, saying Labour's focus was on property speculation that was driving up the cost of housing.

Asked if she was ruling out a land tax on the land a family home sits on, Ms Ardern said she did not want taxation applying to the family home.

"The rest is for working group to work through."

Since the media stand-up, Ms Ardern has clarified her position, telling Radio New Zealand that while the working group can consider a land tax the family home and land it sits on will be exempt.

Any recommendation for a land tax that affected the family home would not be implemented by Labour, Ms Ardern said.

Whether a capital gains tax will be introduced has been a key attack line from National.

Previous leader Andrew Little said if a capital gains tax was recommended by the group, he would implement one only after taking that to the electorate at the next election.

Since taking over as leader Ms Ardern has changed that position - saying she will act on recommendations before the next election in order to address the housing crisis.

She has made clear a capital gains tax would not be applied to the family home.

Federated Farmers today issued a press release saying voters were in the dark on what taxes they will face under a Labour Government.

Vice-president Andrew Hoggard said Ms Ardern's statements that she would wait for recommendations from the working group was a "something of a cop-out" and he believed farmers would be worst hit.

"Even if an exemption applied to the farmhouse, they'll cop it from new taxes far more than their urban cousins."